Schizophrenia, which affects roughly 1% of the world's population, is believed to develop as a consequence of environmental conditions interacting with susceptible genomes. The genomic architecture is set at conception; the environmental challenges occur during early, in utero development of the nervous system, and during the maturation of the nervous system in the post-natal - adolescent period. The end result of these interactions is altered development and maturation of key CNS circuits that lead to the pleiotropic symptoms that define this neuropsychiatric syndrome. Understanding the nature and the mechanism of action of the underlying genomic changes and the environmental factors that contribute to schizophrenia is essential for developing strategies to treat, prevent and ultimately cure this disease. Although the NRG1 gene has been repeatedly linked to schizophrenia susceptibility, the majority of sequence polymorphisms that are associated with disease are non-coding and provide little insight into their contribution to pathology. A disease associated non-synonymous polymorphism within the NRG1 transmembrane domain has been described. Several lines of evidence demonstrate that the affected valine residue is essential for gamma secretase mediated NRG1 intramembranous proteolysis and subsequent transcriptional regulation by the NRG1 intracellular domain. These findings provide the rationale for the studies in this proposal (in response to PAR-08-158). During the R21 phase, I propose to generate lines of mice in which the endogenous transmembrane domain is replaced with the human risk allele. We will then extensively evaluate the effect of this substitution on NRG1-dependent signaling events in neurons; both in vivo and in vitro (AIMS 1 & 2). During the R33 phase, once the mutant mice have been obtained, I propose, during the R33 phase, an in depth analysis of a subset of behaviors and structural phenotypes in neural circuits that underlie schizophrenia associated endophenotypes (AIM 3).